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Chinese chips will continue to power your daily life

Chinese chips will continue to power your daily life

Chinese chips will continue to power your daily life

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To give you a quick overview, many experts have told me that the already stressed global chip supply chain will be further challenged by geopolitics in 2023..

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For much of 2022, the United States began taking steps to exclude China from the industry, even forming an alliance with the Netherlands and Japan to restrict chip exports to the country. The measures have prompted the once market-focused company to come up with contingency plans to survive the Cold War environment, such as diversifying from the Chinese supply chain and building factories elsewhere. We could see other similar plans announced next year. And at the same time, punitive restrictions from the US government will start to be applied and industrial subsidies to domestic chipmakers will start to be distributed, which means that new companies could find themselves ahead while others could be penalized. for continuing to sell to China.

To learn more about how the US, China, Taiwan and Europe could navigate the industry this year, read the full article here.

But I also want to point out something that didn’t make history – a rather unintended result of the chip tech blockade. As the high-end sector of China’s chip industry suffers, the country could play a bigger role in manufacturing older-generation chips that are still widely used in daily life.

This may seem counter-intuitive. Were last year’s US restrictions not meant to seriously harm China’s semiconductor industry?

Yes, but the US government intended to limit the impact on advanced chips. For example, in the area of ​​logic chips – those that perform tasks, as opposed to storing data – US rules only limit China’s ability to produce chips with nodes 14 nanometers or better, which is essentially chip manufacturing technology introduced in the past eight years. The restrictions do not apply to the production of chips with older technologies.

The consideration here is that older chips are widely used in electronics, cars, and other common objects. If the United States were to craft a restriction so broad that it destroyed China’s entire electronics manufacturing industry, it would surely agitate the Chinese government enough to retaliate in a way that would harm the United States. “If you want to piss someone off, push them into a corner and give them no way out. Then they will come and hit you really hard,” says Woz Ahmed, UK-based consultant and former industry executive lice or fleas.

Instead, the idea is to inflict pain only in selective areas, such as the most advanced technologies likely to power China’s supercomputers, artificial intelligence and advanced weapons.

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